Trade Policies Key to Restoring U.S. Manufacturing Sector09/17/2010
During his recent visit to Ford's Southeast Side assembly plant, President Barack Obama reiterated his goal of doubling U.S. exports in five years and lauded the resurgent American auto industry, predicting a return to its glory days.
As a diehard supporter of American manufacturing, as well as a proud Ford owner, I can only applaud his choice of venue, ambitious goal-setting and faith in the American worker. It is clear, however, that we must do much more to rejuvenate our manufacturing sector, which is critical for the economy as a whole, our national security and the health of the middle class.
If you ask any local manufacturer about the obstacles they face today, you are almost certain to hear about China's manipulation of the value of its currency, which keeps the price of its exports artificially low and the price of imports from the United States artificially high. In effect, China has rigged international trade to its advantage. This is one reason our country has lost an astounding one-third of all manufacturing jobs in the past decade.
While the White House has engaged with China regarding its currency policy, little has changed, and economists agree the renminbi remains drastically undervalued. Nevertheless, Treasury Secretary Timothy Geithner has avoided naming China as a currency manipulator, a decision I have strongly criticized and to which I continue to object.
Today, it's clear we need to take action. A bipartisan bill I am cosponsoring, the Currency Reform for Fair Trade Act, H.R. 2378, would explicitly authorize treating currency undervaluation as a prohibited subsidy. This would help hasten the imposition of duties on illegally subsidized Chinese goods, a critical step toward re-establishing fair competition.
Every day we fail to act on this issue is another day American workers and manufacturers suffer. Yet even as China continues to steal American jobs, efforts are under way to push through trade deals that are unfair to American manufacturers. Automakers in particular have expressed concern that the South Korea Free Trade Agreement that the Obama administration plans to present to Congress after the November elections will leave in place numerous barriers to the Korean market, even as Korean companies are handed virtually unfettered access to American consumers. We can't afford another NAFTA-style, job-killing trade deal when millions of Americans are out of work and our nation is struggling to emerge from recession.
Of course, trade issues are often controversial. But I believe there are many steps we can take to support American manufacturing that can earn broad, bipartisan support. That is why I introduced the National Manufacturing Strategy Act, H.R. 4692, which passed the House late last month by a wide margin and has been introduced in the Senate.
This bill is a powerful tool for producing concrete action to help American manufacturers create jobs. It requires the president to establish a Manufacturing Strategy Board of federal officials, two state governors from different parties, and private-sector manufacturing leaders. Every four years, the board will conduct a comprehensive analysis of the manufacturing sector covering matters ranging from financing to the defense industrial base. Based on this analysis and public input, the board will develop a strategy that includes specific recommendations for revitalizing American manufacturing. To make sure we stay the course, the board will assess the implementation of the strategy's recommendations annually, and the Government Accountability Office will conduct a separate review.
Certainly government programs to bolster American manufacturing already exist. The $250 million Export-Import Bank loan guarantee for Ford that the president announced during his visit - and that I support - is one example. Too often, however, our efforts to support manufacturing are disjointed and uncoordinated. The National Manufacturing Strategy Act would help change that by harmonizing existing policies and programs, making them more effective.
I know that America has what it takes to remain a world leader in diverse fields, such as aerospace and automobiles. But in order for our manufacturers to thrive, we need to step up and insist that the rest of the world play by the rules. Directly addressing China's unfair trade policies and refusing to sign any trade deal that leaves American workers at a disadvantage would be a good start.
At the same time, we cannot allow disputes over trade issues to obscure the importance of manufacturing or prevent lawmakers on both sides of the aisle from joining together to support this essential industry.